In his first budget response since become party leader last autumn, Mr Duncan Smith underlined Tory claims that the NHS cannot be saved in its present form, arguing that Britain is "further away from the ideals of the NHS than at any other time in its history".

Claiming the promised national debate over NHS funding was a sham, the Tory leader also accused Mr Brown of breaking a general election promise and raising income tax through the back door.

The penny rise in national insurance amounted to an extra penny on income tax, he said. "This government said it wouldn't raise income taxes at all and everyone knows this is a tax on income."

Someone on average earnings would be £15 a month worse off as a result of the tax rise, he said. A nurse consultant earning £34,000 would be £24 worse off a month, and a police inspector earning £37,000 would be £27 worse off every month.

"So much for your great help for all those trying hard in the public services," Mr Duncan Smith said. "Frankly, after this, no one will ever believe another word you say."

He said British people and businesses were already paying £100bn a year more in tax than they were in 1997. All of Mr Brown's budgets - save the one before the last general election - had raised taxes.

"Every man, woman and child in this country is now paying at least £1,600 more in tax since you delivered your first Budget," he told the chancellor.

The Tories also challenged Mr Brown's portrayal of a healthy economy, arguing that Britain is now running a deficit for the first time in four years.

Public investment dropped by £1bn last year compared with the chancellor's estimate at the time of the pre-budget report, Mr Duncan Smith told MPs. He accused the chancellor of turning "small print into a fine art", saying Britain's export performance was falling behind while world trade was set to grow by 2.25%.

Mr Duncan Smith, less confident than his predecessor performing one of the hardest Commons tasks faced by opposition leaders, launched an assault on public sector failings, highlighting chaotic transport, rising teacher vacancies and an "epidemic" of violent crime.

The "saddest and most acute failure" was the state of the NHS, he said, asking where an increase of nearly a third in health spending had gone.

Waiting lists were rising, hospital beds were blocked, and patients were even being forced to go abroad for treatment. "The health service is letting people down, particularly the elderly and the vulnerable."

The Tory leader said he had hoped for "a little humility" and a more imaginative approach from the chancellor. "All he is offering is more of the same. More talk, more tax but it will not save the NHS from failure."

The NHS was a "two-tier service", where more people paid for their treatment than ever before, he said, attacking the chancellor for not following his own example and visiting other countries to examine alternative models of healthcare. "The NHS needs change as much as it needs money."

Charles Kennedy, the Liberal Democrat leader, welcomed the chancellor's planned tax rise, though he argued that Labour should - like his own party - have acknowledged the increase would be necessary at the last election.

He turned his fire primarily on Mr Duncan Smith, pointing to "a clear ideological divide" between the government and the Lib Dems on one side and "incoherence of the Conservatives on the other".

But he attacked Labour's delay in introducing a substantial injection of funding. "The health service increase will of course be welcome but for many patients it has come anything up to five years too late," he said. "This would have been a really good budget five years ago.

"That doesn't stop it being in many respects a very welcome budget five years later, but a lot of credibility and a lot of opportunity has nonetheless been lost by the government in that intervening five years.

"Too many broken promises, too many misleading targets, too much double and treble counting, too much spin, not enough delivery and investment where the public really wanted it."

The Lib Dems want to see further debate on ringfencing taxes for the health service - a proposal the party is likely to adopt itself. Mr Kennedy also called for a timetable for entry, subject to a referendum, to the single currency.